Abstract/Summary

Cambodia is entering a new phase of decentralisation and deconcentration (D&D), aiming to restructure sub-national administration, particularly at the provincial level. The reform seeks to establish unified provincial and district administrations accountable to both the central government and local populations, supported by transparent allocation of functions and funding. However, the mechanisms for achieving accountable fiscal relationships remain unclear, and provincial public finance arrangements are poorly understood. Drawing on three years of research within a broader study on sub-national accountability, this paper examines provincial public expenditure management (PEM) through the lens of accountability. It identifies three distinct PEM systems—mainstream government, reform initiatives, and donor vertical programmes—each with unique accountability structures. The study reveals a highly centralised system, with provinces receiving limited funding and discretion, and donor-driven programmes dominating development budgets. Weak accountability in mainstream PEM has led to high fiduciary risks and poor budget execution, prompting donors to adopt parallel systems. Additionally, informal patronage networks significantly influence PEM processes. The paper concludes that successful D&D reform requires long-term, sequenced efforts integrating technical and political strategies, and coordination with broader reforms in public financial management, aid harmonisation, and human resources.

DOI: https://doi.org/10.64202/wp.38.200807